Social Capital, Innovativeness and the New Economic Geography

  • Charlie Karlsson
  • Hans WestlundEmail author
Living reference work entry


This chapter discusses the relationship between, on the one hand, the knowledge economy’s social capital and innovativeness and, on the other hand, the new economic geography, which mainly is valid for the manufacturing economy. The discussion ends up in a proposition for a “new economic geography 2 model,” in which the knowledge producing sector and its relations to other sectors are modelled in a framework of two or more regions. The overarching mechanisms and results are similar in the two models: cumulative causation create and enhance regional disparities, but the processes are partly different. It may seem somewhat paradoxical that the industrial specialization, which is a result of the original new economic geography model, in the new model is replaced by “specialization in diversification,” but the knowledge economy’s specialization is “subtle” and diverse – and, as it seems, with subsectors related to and dependent on each other. This is all a reflection of the proposition that social capital and innovativeness play a much larger role for growth and development in the knowledge economy than they did in the manufacturing economy.


Social capital Innovativeness Knowledge economy Knowledge spillovers New economic geography 2 Cumulative causation Economies of scale Increasing returns Diverse specialization 


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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2020

Authors and Affiliations

  1. 1.Jönköping International Business SchoolJönköping UniversityJönköpingSweden
  2. 2.Department of Urban Planning and EnvironmentKTH Royal Institute of TechnologyStockholmSweden

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